A guide to the UK property market

The UK property market is notoriously expensive and uneven. There is a marked divide between properties in the South East, particularly around Greater London, where prices are often jaw-droppingly expensive, and the rest of the country, where they are more reasonable. The recession of 2008-2010 proved that to a large extent London was immune to the property price crash that hit the rest of the country.

Prior to 2008

Prices between 1966-1998
Property prices in the UK began to accelerate in about 1966, and peaked in 1987. A house price crash accompanied the mid-1980s recession but prices started to recover sufficiently in about 1998. From then on, the rise was meteoric, far outstripping the upturn which had peaked in the mid-1980s. In fact, in 14 short years, the average price of a house tripled from about £60,000 to more than £190,000. Clearly, this was unsustainable.
The 2008-2010 crash
In late 2008, the credit crunch hit world markets and the global economy began a sharp fall into recession. The UK property market plunged. However, the suddenness and depth of the fall took many by surprise - indeed, almost overnight average property prices plunged to less than £160,000.
The North-South divide
Although London and the South East were affected by the fall in prices, 2009 was a particularly bumpy year - there is no doubt that the North, Wales and other regional areas suffered far worse. While there had always been a divide between the North and South, the property crash precipitated by the credit crunch, simply widened the gap even further.

Since 2010

Speculation and predictions
Property price analysts, economists and estate agents are quoted nearly everyday on the future of the property market in the UK, but their views are often mere speculation - a cursory glance back at previous predictions shows that nobody can be certain about what the future holds.
Recent developments
Latest news suggests that home ownership in the UK will fall to its lowest levels since the mid-1980s. The National Housing Federation was reported as claiming that property owners will fall to only 64% compared to 73% in 2001 as house prices rise again, and first-time buyers are frozen out of the market by the difficulties of getting a deposit.